LNP wants Galilee Basin royalties stashed in investment fund

Royalties from resources projects in the Galilee Basin would be poured into a new sovereign wealth fund to preserve the benefits of Queensland's coal boom under an LNP policy the opposition has urged Labor to support.

Shadow treasurer Tim Mander has written to Treasurer Jackie Trad to seek her support for the LNP's proposal.

Shadow Treasurer Tim Mander said if the Palaszczuk government established a sovereign wealth fund, it would have the support of the Queensland LNP.Credit:AAP Image/ Dan Peled

A sovereign wealth fund is a state-owned investment vehicle, which invests in assets such as stocks, bonds, real estate or hedge funds.

Currently, royalties from resources projects are funnelled into consolidated revenue to be distributed during the budget process.

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In his letter, Mr Mander said the opening of the Galilee Basin provided a once-in-a-generation opportunity to establish a sovereign wealth fund to ensure future generations could benefit from Queensland's exhaustible resources.

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"Queensland Treasury only include projects that have made a final investment decision in the forward projections for royalty receipts, so the royalties from the Adani Carmichael mine are yet to be included in the published projections," he said.

"Indeed, this is the case for all future Galilee Basin resource projects.

"With the recent co-ordinator general approval of the $6.7 billion China Stone project and with a number of other highly advanced projects in the Galilee Basin, now is the time for Queensland to establish a sovereign wealth fund."

Mr Mander said governments of other resource-rich states and nations such as Norway, the emirate of Abu Dhabi, Kuwait, Chile and Saudi Arabia had established sovereign wealth funds.

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"Queensland should establish a sovereign wealth fund to preserve the benefits of the Galilee Basin coal boom," he said.

"A sovereign wealth fund would also ensure a clear and transparent process about how royalties from the Galilee Basin are being invested to benefit all of Queensland, rather than the opaque nature of the budget process."

Mr Mander said investments in Queensland should be the priority of any sovereign wealth fund to ensure the state received the maximum benefit from its resources.

"As a father and a grandfather, I am more and more determined that we need to make sure we leave something for the next generation," he said.

"In decades to come, as global energy demands change, we need to ensure Queensland has a more diverse economy with revenue streams beyond coal royalties."

Mr Mander said if the Palaszczuk government established the fund, it would have the support of the Queensland LNP.

"We would welcome consultation on the mandate of the sovereign wealth fund and the selection of guardians to oversee the fund," he said.

Ms Trad was not supportive of the idea.

"The LNP cooked up this idea in the middle of the bushfire emergency across our state when thousands of people were being evacuated from their homes," she said.

"The fact is that they're spending money that doesn't even exist yet and that the state may never see."

Queensland Deputy Premier Jackie Trad would not give her support.Credit:AAP

Last week, Adani Australia mining chief executive Lucas Dow announced its scaled-back Carmichael mine would be "100 per cent financed" from within the Adani conglomerate and construction would begin.